London — Demand for liquefied natural gas (LNG) is set to increase steadily for several decades helped by economic growth in Asia, industry executives told the Gastech summit this week, with the COVID-19 pandemic seen as only a short-term setback.
“While the world continues to grapple with the severe impacts of market demand and the impact of COVID-19, long-term fundamentals remain strong supported by growing population and energy demand,” Irtiza Sayyed, president, ExxonMobil LNG Market Development Inc, said.
Global gas demand is forecast to decline by around 3% in 2020 and make a robust recovery after that, according to International Energy Forum.
With the world seeking cleaner energy sources to reduce pollution and CO2 emissions, gas and LNG are expected to provide the corridor to a net-zero future.
“LNG is and will remain a high-growth industry based on a growing economy worldwide, particularly in Asia, with a desire for secure, affordable and cleaner-burning fuels,” Douglas Wharton, vice president, Cheniere Marketing Pte. Ltd. , told Gastech.
The global gas and LNG conference, launched in London in 1972, was held virtually this year due to the COVID-19 pandemic. It will be held in Singapore next year.
Cheniere forecasts LNG trade demand will grow by an average 3.4% a year between 2019 and 2040, with additional supply required to achieve such growth.
Some executives at the summit said that as coronavirus had reduced investment in new production, supply may not recover as fast as demand.
Around two thirds of the growth in LNG demand in the next decade will come from China, India, Pakistan and Bangladesh, according to Wood Mackenzie.
Industry executives from India and Taiwan said LNG demand in their countries is growing this year, while most speakers agreed China will be the key driving force for LNG demand in coming decades.
China’s gas demand is expected to exceed 600 billion cubic metres (bcm) per year by 2040, up from just over 300 bcm per year in 2020, according to Ming Cai, natural gas and LNG consultant at Poten & Partners.
(Reporting by Ekaterina Kravtsova in London and Jessica Jaganathan in Singapore Editing by Susan Fenton)